At the International Value Summit 2025, the Union Minister for Road Transport and Highways stated that India is the third-largest automobile market, aiming for No. 1 globally in five years.

• In 2025, India surpassed Japan to emerge as the world’s 3rd largest automobile market, after China and the United States.

Key Data & Facts

• Global Contribution: India’s automotive sector contributes 7.1% to global GDP.
• Market Size: The Indian automobile sector, including vehicles and auto components, is valued at nearly ₹22 lakh crore, making it one of the largest industries in the economy.
• Passenger Vehicle Sales (2023): India sold 4.11 million units, overtaking Japan’s ~4 million sales, marking a major shift in global rankings.
• Exports Performance: In FY24, India exported 6.62 million vehicles, making it a global hub for two-wheelers and small cars.
• Two-Wheeler Dominance: More than 50% of India’s two-wheeler production is exported, reflecting India’s global competitiveness and cost advantage in this segment.
• Auto Components: With a turnover of ₹6.14 lakh crore ($74.1 billion) in FY24, the auto component sector contributes 2.3% to GDP, with exports worth $21.2 billion, projected to reach $30 billion by 2026.
• EV Penetration: By August 2024, 4.4 million EVs were registered, accounting for 6.6% penetration, signalling the beginning of India’s green mobility revolution.
• Future Scope: With targeted reforms and stronger GVC integration, India aims to raise its global auto component trade share from 3% to 8% by 2030.

Drivers of Automobile Growth in India

• Rising Global Presence: All major automobile brands are now manufacturing in India, from Maruti-Suzuki and Hyundai to Toyota, Tesla, and Mercedes.
• • The trend has shifted from assembling vehicles for local markets to exporting Indian-manufactured cars worldwide, especially to Africa, Latin America, and South Asia.
• Clean & Green Mobility Push: Electric Vehicles (EVs) are supported under FAME II (Faster Adoption and Manufacturing of Electric Vehicles) and PLI schemes, India is building an EV ecosystem.
  • Hydrogen Mobility: Launch of hydrogen trucks, with pilot projects running on 10 key transport routes, signals a futuristic shift.
  • Alternative Fuels: Trials underway on isobutanol, bio-bitumen, and ethanol blends, aimed at reducing oil imports.
• Expanding Road Infrastructure: India now has the second-largest road network in the world, after the United States.
• Other Growth Drivers: A large domestic market, cost competitiveness, skilled workforce, and strong policy push (FAME, PM E-Drive, PLI, GST, scrappage) collectively position India as a rising global hub for automobile production, exports, and EV innovation.

DOWNLOAD PDF